Foundations of Economics

One of my daughter’s former professors at Grove City College recently wrote an economics text book. (Foundations of Economics, Shawn Ritenour) Because of Laura’s respect for this professor, I decided to purchase a used copy of the book and read it. I expected it to be pretty dry, something to help me sleep. However, I am enjoying the book. It is extremely relevant in light of current global events, the US elections, and personal financial decisions. Ritenour explicitly writes from a Christian perspective. He believes the Bible and bases his economic theory on his understanding of Scripture.

After carefully studying the Bible and observing human behavior, Ritenour concludes that a prosperous and peaceful society is not possible unless people are free to own and exchange material goods. This freedom to exchange provides the foundation for a division of labor that results in social cooperation and advancement. He exclaims that …

Socialism is doomed to failure because there is no way for a central planner to efficiently allocate factors of production toward making those goods most in demand. … Without market prices of capital goods, there is no way for the central planner to compare the economic value of different materials and techniques that could be used to produce consumers’ goods. … (This) is the main reason why one sees so much absolute waste and subsequent poverty in a socialist economy.

… So if we want to be fruitful and multiply and replenish the earth while we subdue it and if we want to be able to do this without killing one another, then we must maintain private property. (pg. xvi, xvii)

From this and other clearly communicated assumptions, Ritenour builds a compelling economic model. His writing is enjoyable and easy to read due to his generous use of simple illustrations and humor. It is the kind of book that probably a lot of people should read, but most won’t. Too bad.